Team, Inc. Reports Mixed Q3 Results with Revenue Growth and Improved Operating Income, but Net Loss and Equity Decline

Team, Inc. (NYSE: TISI) reported its financial results for the third quarter and nine months ended September 30, 2024, highlighting a mixed performance in revenue and profitability compared to the previous fiscal period.

For the three months ended September 30, 2024, Team, Inc. generated revenues of $210.8 million, a 2.0% increase from $206.7 million in the same period of 2023. The growth was primarily driven by the Inspection and Heat Treating (IHT) segment, which reported revenues of $107.6 million, up from $103.9 million in the prior year. However, revenues for the nine months ended September 30, 2024, decreased to $639.0 million from $648.5 million in 2023, reflecting a 1.5% decline.

Operating income for the third quarter improved significantly to $3.2 million, compared to an operating loss of $1.3 million in the same quarter of 2023. For the nine-month period, operating income was $7.9 million, a substantial recovery from an operating loss of $4.4 million in the prior year. The IHT segment's operating income rose to $9.9 million, up from $6.4 million, while the Mechanical Services (MS) segment saw a decrease in operating income to $19.0 million from $22.2 million.

Despite the improvements in operating income, Team, Inc. reported a net loss of $11.1 million for the third quarter, slightly better than the $12.1 million loss in the same quarter of 2023. For the nine months, the net loss narrowed to $31.1 million from $52.6 million in the previous year, indicating a 40.9% improvement.

The company’s total assets decreased to $545.4 million as of September 30, 2024, down from $565.7 million at the end of 2023. Total liabilities increased to $527.5 million, up from $520.1 million, while total equity plummeted to $17.9 million from $45.6 million, reflecting ongoing financial challenges.

In terms of cash flow, Team, Inc. reported net cash provided by operating activities of $1.1 million for the nine months ended September 30, 2024, a significant turnaround from the $22.1 million used in the same period of 2023. The company also noted a decrease in cash and cash equivalents to $19.1 million from $35.4 million at the end of 2023.

Strategically, Team, Inc. entered into amendments with lenders on September 30, 2024, extending the maturity of its credit agreements and adjusting applicable margins based on EBITDA. The company is actively working to regain compliance with NYSE listing standards after receiving a notice of non-compliance in March 2024 due to market capitalization and equity deficiencies.